Brexit secretary David Davis was forced to capitulate on a key disagreement during the first day of negotiations with the European Union yesterday, backing down on a battle he previously said would become “the row of the summer”.
The UK kicked off talks in Brussels with both sides agreeing a schedule for dialogue as they attempt to pave the way to Brexit.
Officials will meet on a monthly basis. However, in a significant concession, Britain's negotiators have now agreed to an EU demand to delay talks on a new trading relationship.
Previously, the UK had insisted on so-called parallel talks, in which both divorce terms and a future relationship would be covered simultaneously. EU officials have long insisted on covering the topics in sequence.
In a decision branded “common sense” by EU chief negotiator Michel Barnier, the UK will now work to Brussels' timetable.
The agreement appears to be a U-turn by Davis. In mid-May, he claimed: “You can't decide one without the other. It's wholly illogical and we happen to think the wrong interpretation of the treaty, so that will be the row of the summer.”
And the letter sent by Prime Minister Theresa May to the EU triggering Article 50 in March had said: “We believe it is necessary to agree the terms of our future partnership alongside those of our withdrawal from the EU.”
Institute of Directors deputy director of policy Edwin Morgan said the terms may mean the UK is forced to agree to a large financial settlement in order to push on with trade negotiations.
“They have got to be practical. It's much more important to get the negotiations off to a good start and get rattling through them than getting stuck on a debate about money,” he said, adding that time pressure also heightened the need for transitional arrangements.
Despite the climbdown, Davis insisted the UK's position remained perfectly consistent.
“When we eventually get to the stage where the council decide we have made enough progress, both sets of dialogue will continue, including free trade. Not just trade, including customs, security, obviously cooperation in all sorts of way”.
Asked if the EU had made any concession to the UK, Barnier said: “The UK has decided to leave the EU. It is not the other way around...So we each have to assume our responsibility and the consequences of our decision, and the consequences are substantial.”
He also said that “a fair deal is possible and far better than no deal”.
Speaking to the BBC Sophia in t'Veld, deputy to EU parliament chief negotiator Guy Verhofstadt. echoed Barnier: “I know that some people claim that no deal is better than a bad deal, and that sounds really tough.
“But if you think of the consequences, and what no deal would mean...from one moment to the next there will be chaos. No deal means chaos.”